John Deere Capital Corp. Posts Strong 27.8% Net Income Jump in FY25

TL;DR

**JDCC's financial arm is crushing it, up 27.8% in net income, proving its value even as equipment sales dip – a solid buy signal for the long haul.**

AI Summary

John Deere Capital Corporation (Capital Corporation) reported a net income of $890 million for fiscal year 2025, a significant increase from $696 million in fiscal year 2024. This 27.8% rise was primarily driven by valuation adjustments on assets held for sale in Brazil, lower administrative and operating expenses, favorable financing spreads, and a reduced provision for credit losses. The company, a wholly-owned subsidiary of John Deere Financial Services, Inc., which is in turn owned by Deere & Company, provides financing for retail and wholesale purchases of John Deere equipment across various segments including production and precision agriculture, small agriculture and turf, and construction and forestry. Capital Corporation's operations are deeply integrated with Deere & Company's Smart Industrial Operating Model and refined Leap Ambitions, focusing on providing financial solutions to support these strategic goals. While Deere & Company's consolidated net sales and revenues decreased by 12% to $45,684 million in 2025 due to lower equipment sales volumes, Capital Corporation's financial services segment demonstrated resilience and growth. The company maintains a tangible net worth of $5,929.8 million as of November 2, 2025, well above the $50.0 million minimum required by its agreement with Deere & Company.

Why It Matters

John Deere Capital Corporation's robust financial performance, with a 27.8% increase in net income to $890 million in fiscal 2025, signals strong underlying demand for financing solutions despite a 12% decline in Deere & Company's overall equipment sales. This resilience is crucial for investors as it demonstrates the stability and profitability of the financial services arm, which is integral to facilitating equipment sales for its parent company. For employees and customers, it ensures continued access to competitive financing options, supporting the purchase of essential agricultural and construction machinery. In a competitive landscape, the ability to offer attractive financing is a key differentiator, reinforcing John Deere's market position and its 'Smart Industrial Operating Model' by enabling its 'Leap Ambitions' through integrated financial solutions.

Risk Assessment

Risk Level: low — The risk level is low due to the explicit support agreement with Deere & Company, which obligates the parent to maintain Capital Corporation's consolidated tangible net worth at not less than $50.0 million and its consolidated ratio of earnings to fixed charges at not less than 1.05 to 1. As of November 2, 2025, Capital Corporation's tangible net worth was $5,929.8 million, significantly exceeding the minimum threshold, indicating strong financial backing.

Analyst Insight

Investors should view John Deere Capital Corporation's strong financial performance as a positive indicator for Deere & Company's overall ecosystem, despite a dip in equipment sales. Consider this a stable, income-generating component that mitigates some cyclical risks of equipment manufacturing, making DE an attractive long-term holding.

Key Numbers

• $890M — Net Income for Fiscal 2025 (Increased from $696 million in fiscal 2024, a 27.8% rise.)
• $696M — Net Income for Fiscal 2024 (Compared to $890 million in fiscal 2025.)
• $5,027M — Worldwide Net Income Attributable to Deere & Company for Fiscal 2025 (Decreased from $7,100 million in fiscal 2024.)
• $45,684M — Deere & Company's Consolidated Net Sales and Revenues for Fiscal 2025 (Decreased 12% from $51,716 million in 2024.)
• $5,929.8M — Consolidated Tangible Net Worth at November 2, 2025 (Exceeds the $50.0 million minimum required by agreement with Deere & Company.)
• 2,500 — Shares of Common Stock Outstanding at December 18, 2025 (All owned by John Deere Financial Services, Inc.)
• 1.05 to 1 — Minimum Consolidated Ratio of Earnings to Fixed Charges (Deere & Company's obligation to maintain for Capital Corporation.)
• 51% — Minimum Voting Shares of Capital Stock (Deere & Company's agreement to own in Capital Corporation.)

Key Players & Entities

• DEERE JOHN CAPITAL CORP (company) — registrant
• Deere & Company (company) — parent company
• John Deere Financial Services, Inc. (company) — wholly-owned subsidiary of Deere & Company and owner of Capital Corporation
• Office of the Comptroller of the Currency (regulator) — regulates John Deere Financial, f.s.b.
• U.S. Federal Reserve Board (regulator) — oversight of Capital Corporation
• John Deere Financial, f.s.b. (company) — wholly-owned subsidiary of Capital Corporation
• Delaware (regulator) — state of incorporation
• New York Stock Exchange (regulator) — exchange for 2.00% Senior Notes Due 2031

FAQ

Risk Factors

• Credit Risk from Financing Operations [high — financial]: Capital Corporation's primary business is providing financing for John Deere equipment. This exposes the company to credit risk if customers default on their retail or wholesale financing obligations. The value of repossessed equipment may not be sufficient to cover outstanding balances, especially during economic downturns or industry-specific challenges.
• Interest Rate Sensitivity [medium — market]: As a financing company, Capital Corporation is exposed to interest rate risk. Changes in interest rates can affect the cost of its funding and the profitability of its financing spreads. The company's ability to pass on increased borrowing costs to customers is limited by competitive market conditions and the terms of its financing agreements.
• Dependence on John Deere Equipment Sales [high — operational]: Capital Corporation's business is intrinsically linked to the sales performance of John Deere equipment. A significant decline in demand for John Deere equipment, due to factors like economic slowdowns, agricultural commodity price volatility, or competitive pressures, would directly impact the volume of financing opportunities for Capital Corporation.
• Compliance with Financial Regulations [medium — regulatory]: As a financial services provider, Capital Corporation is subject to various regulatory requirements in the jurisdictions where it operates. Non-compliance with consumer protection laws, lending regulations, or capital adequacy rules could result in fines, penalties, and reputational damage.
• Valuation Adjustments on Assets [medium — financial]: The company's net income can be significantly impacted by valuation adjustments on assets, as seen with the positive impact from assets held for sale in Brazil. Fluctuations in asset valuations, particularly for equipment held as collateral or for resale, can introduce volatility into earnings.

Industry Context

John Deere Capital Corporation operates within the specialized niche of financing agricultural, construction, and forestry equipment, closely mirroring the sales cycles and market dynamics of its parent, Deere & Company. The industry is characterized by high capital intensity, cyclical demand tied to commodity prices and global economic conditions, and increasing integration of technology in equipment, which influences financing needs. Competition comes from other captive finance arms of heavy equipment manufacturers and general financial institutions.

Regulatory Implications

As a financial services provider, Capital Corporation faces ongoing regulatory scrutiny in multiple jurisdictions. Compliance with consumer protection laws, lending standards, and capital adequacy requirements is paramount. Changes in financial regulations or increased enforcement could impact operating costs and business practices.

What Investors Should Do

1. Monitor Deere & Company's equipment sales volumes and market share.
2. Analyze trends in interest rates and their impact on financing spreads.
3. Assess the impact of economic conditions on agricultural and construction sectors.
4. Review the company's provision for credit losses and non-performing assets.

Key Dates

• 2025-11-02: Fiscal Year End — Reporting period for the 10-K, showing a net income of $890 million and tangible net worth of $5,929.8 million.
• 2024-11-02: Previous Fiscal Year End — Reported net income of $696 million, providing a basis for year-over-year comparison.

Glossary

Capital Corporation

John Deere Capital Corporation, a wholly-owned subsidiary of John Deere Financial Services, Inc., providing financing for John Deere equipment. (The primary entity discussed in the 10-K.)

John Deere

Deere & Company and its wholly-owned subsidiaries. (The parent company whose equipment Capital Corporation finances.)

Tangible Net Worth

Net worth excluding intangible assets. It's a measure of a company's financial strength and ability to absorb losses. (Capital Corporation's tangible net worth of $5,929.8 million significantly exceeds the minimum requirement, indicating financial stability.)

Provision for Credit Losses

An expense set aside by a company to cover potential losses from loans or accounts receivable that may not be repaid. (A reduction in this provision contributed to the increase in net income for fiscal year 2025.)

Financing Spreads

The difference between the interest rate a financial institution earns on its assets (loans) and the interest rate it pays on its liabilities (borrowings). (Favorable financing spreads were a key driver of Capital Corporation's increased net income.)

Year-Over-Year Comparison

John Deere Capital Corporation demonstrated significant financial improvement in fiscal year 2025 compared to 2024, with net income surging by 27.8% to $890 million. This growth was driven by positive valuation adjustments on assets held for sale in Brazil, reduced operating expenses, improved financing spreads, and a lower provision for credit losses. While Deere & Company's consolidated revenues saw a decline, Capital Corporation's financial services segment proved resilient, highlighting the effectiveness of its integrated strategy and financial management.

Key Financial Figures

• $5,027 — ome attributable to Deere & Company was $5,027, or $18.50 per share, compared with $7,
• $18.50 — table to Deere & Company was $5,027, or $18.50 per share, compared with $7,100, or $25
• $7,100 — 027, or $18.50 per share, compared with $7,100, or $25.62 per share, in fiscal 2024.
• $25.62 — .50 per share, compared with $7,100, or $25.62 per share, in fiscal 2024. Deere & Com
• $45,684 — net sales and revenues decreased 12% to $45,684 in 2025, compared with $51,716 in 2024.
• $51,716 — d 12% to $45,684 in 2025, compared with $51,716 in 2024. Net sales of the equipment ope
• $38,917 — operations decreased in fiscal 2025 to $38,917, compared with $44,759 last year, due t
• $44,759 — n fiscal 2025 to $38,917, compared with $44,759 last year, due to lower sales volumes d
• $890 — vices operations reported net income of $890 for fiscal 2025 compared with $696 in f
• $696 — e of $890 for fiscal 2025 compared with $696 in fiscal 2024. Net income increased du
• $50.0 — ted tangible net worth at not less than $50.0. This agreement also obligates Deere &
• $5,929.8 — our consolidated tangible net worth was $5,929.8. We also have an international support

Filing Documents

• jdcc-20251102x10k.htm (10-K) — 3721KB
• jdcc-20251102xex23.htm (EX-23) — 3KB
• jdcc-20251102xex32.htm (EX-32) — 11KB
• jdcc-20251102xex31d1.htm (EX-31.1) — 19KB
• jdcc-20251102xex31d2.htm (EX-31.2) — 19KB
• jdcc-20251102x10k003.jpg (GRAPHIC) — 75KB
• jdcc-20251102x10k004.jpg (GRAPHIC) — 28KB
• 0001104659-25-122363.txt ( ) — 17778KB
• jdcc-20251102.xsd (EX-101.SCH) — 109KB
• jdcc-20251102_cal.xml (EX-101.CAL) — 118KB
• jdcc-20251102_def.xml (EX-101.DEF) — 447KB
• jdcc-20251102_lab.xml (EX-101.LAB) — 864KB
• jdcc-20251102_pre.xml (EX-101.PRE) — 677KB
• jdcc-20251102x10k_htm.xml (XML) — 4235KB

Business

Business 2 Item 1A.

Risk Factors

Risk Factors 11 Item 1B. Unresolved Staff Comments 22 Item 1C . Cybersecurity 23 Item 2 .

Properties

Properties 24 Item 3.

Legal Proceedings

Legal Proceedings 24 Item 4. Mine Safety Disclosures 24 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 25 Item 6. [Reserved] 25 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 25 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 36 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 37 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 37 Item 9A.

Controls and Procedures

Controls and Procedures 37 Item 9B. Other Information 37 Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections 37 PART III Item 10. Directors, Executive Officers and Corporate Governance 38 Item 11.

Executive Compensation

Executive Compensation 38 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 38 Item 13. Certain Relationships and Related Transactions, and Director Independence 38 Item 14. Principal Accountant Fees and Services 38 PART IV Item 15. Exhibits and Financial Statement Schedules 39 Item 16. Form 10-K Summary 39 1 Table of Contents PART I

BUSINESS

ITEM 1. BUSINESS. This Annual Report on Form 10-K contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact included in this Annual Report on Form 10-K are forward-looking statements. Forward-looking statements provide our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance, and business. You can identify forward-looking statements as they do not relate to historical or current facts and by words such as "believe," "expect," "estimate," "anticipate," "will," "aim," "should," "plan," "forecast," "target," "guide," "project," "intend," "could," and similar words or expressions. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expected. Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, and other important information about forward-looking statements are disclosed under Item 1A, "Risk Factors," and Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations–Forward-Looking Statements" in this Annual Report on Form 10-K. As used herein, John Deere Capital Corporation (Capital Corporation) and its subsidiaries are collectively referred to as "we," "us," "our," or "the Company," unless designated or identified otherwise. Presentation of Amounts All amounts are presented in millions of U.S. dollars, unless otherwise specified. The Company Capital Corporation was incorporated under the laws of Delaware and commenced operations in 1958. All of our outstanding common stock is owned by John Deere Financial Services, Inc. (JDFS), a wholly-owned subsidiary of Deere & Company. See "Our Relationships with John Deere" for additional information regarding agreements between us and Deere & Company. We conduct business in A

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